Nigeria’s new vehicle market is expected to maintain strong growth in 2026, with sales projected to increase by 7.6 per cent, supported by the full operation of the Dangote Petroleum Refinery, easing inflation and government incentives for electric vehicles (EVs).
The projection is contained in BMI’s latest Sub-Saharan Africa Autos Report, which estimates that the country’s new vehicle sales grew by about 20 per cent in 2025 and will continue expanding despite lingering economic challenges.
According to BMI, the full ramp-up of the Dangote refinery to its 650,000 barrels-per-day capacity in February 2026 is expected to improve domestic fuel supply, reduce Nigeria’s dependence on imported petroleum products and provide greater support for the naira.
“We forecast new vehicle sales in Nigeria to rise by 7.6% in 2026, following a 20.0% increase in 2025. The continued ramp-up of the Dangote refinery… is a key supporting factor, with enhanced local fuel supply reducing import dependency and supporting the naira,” the report stated.
BMI also identified moderating inflation as another major factor supporting vehicle demand. Nigeria’s annual inflation slowed to 15.1 per cent in February 2026—its lowest level since November 2020—marking the 11th consecutive month of disinflation.
The report noted that easing inflation should improve household purchasing power, allowing consumers to spend more on discretionary items, including new vehicles. However, it warned that renewed depreciation of the naira later in the year could increase vehicle import costs and temper demand.
Beyond 2026, BMI projects Nigeria’s automotive market to record a compound annual growth rate (CAGR) of 6.4 per cent between 2026 and 2032.
The expected growth will be driven by rising demand for personal mobility, expansion of logistics and transport services, and government efforts to encourage local vehicle manufacturing.
The report also forecasts that Nigeria’s electric vehicle segment will outpace the broader automotive market.
BMI attributed the expected growth to higher petrol prices following subsidy removal, increasing private-sector investment in EV charging infrastructure and government policies designed to encourage EV adoption.
Among the key policy measures are the reduction of import duties on fully built electric vehicles and Nigeria’s target of achieving 30 per cent local EV production by 2033.
The report added that Nigeria’s abundant natural gas reserves also present significant opportunities for compressed natural gas (CNG) vehicles, offering motorists lower operating costs while reducing dependence on imported fuels.
Despite Nigeria’s positive outlook, BMI lowered its forecast for overall vehicle sales growth across Sub-Saharan Africa.
The research firm now expects regional vehicle sales to grow by 1.9 per cent to approximately 1.2 million units in 2026, down from an earlier forecast of 4.4 per cent.
The downgrade reflects concerns over geopolitical tensions, particularly the conflict involving Iran, which could push global fuel prices higher and increase vehicle import costs.
“SSA consumers are highly price sensitive. The region’s heavy reliance on imported vehicles and automotive components leaves it particularly exposed,” BMI said.
The report also warned that supply chain disruptions affecting key raw materials such as aluminium and plastics could place additional pressure on manufacturers.
